Hidden spending measures playing chicken with shutdown

Oct. 7, 2013
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Temporary spending bills approved by both the House and the Senate include measures that would require the Obama administration to rescind strict rules that give independent chicken farmers more clout in their business dealings with poultry processors. / Robert F. Bukaty, AP file

by Fredreka Schouten, USA TODAY

by Fredreka Schouten, USA TODAY

WASHINGTON - Temporary spending bills approved by the House of Representatives and the Senate include measures that would require the Obama administration to rescind strict new rules on the poultry industry.

Advocates for independent chicken farmers want lawmakers to drop the language, which had been sought by poultry processors and their trade groups. The rules give farmers more clout in their business dealings with the processors.

"It's totally outrageous for a handful of multinational corporations to waltz in while we are trying to keep the government open and insert these" provisions, said Ferd Hoefner, policy director of the National Sustainable Agriculture Coalition, one of the groups siding with roughly 32,000 farmers who produce the broiler chickens that end up on supermarket shelves.

The most recent showdown between the two adversaries illustrates the way interest groups, large and small, are racing to shape whatever stopgap spending bill Congress passes to end the partial government shutdown that began Oct. 1.

Medical-device manufacturers, for instance, are lobbying aggressively to repeal a 2.3% excise tax imposed on their industry as part of the 2010 Affordable Care Act. Some of the medical-device makers' supporters on Capitol Hill want to insert the language in either a temporary spending bill restarting government operations or in another measure to raise the nation's debt ceiling. Treasury Secretary Jacob Lew has warned the government will run out of borrowed money Oct. 17, requiring action by Congress.

Since the normal process of passing a budget and 12 separate appropriations bills has failed in Congress, "there's only one train leaving the station, and everyone has to be on it," said Bill Allison, who examines lobbying and political money at the nonpartisan Sunlight Foundation.

"Lobbyists are working hard to get their provisions in the bill," he said, "and when you have legislation done this way - on the fly, at the last minute - it's so much easier to slip in special-interest provisions."

J.C. Scott, chief lobbyist for the Advanced Medical Technology Association, said his group is "cautiously optimistic" that lawmakers will agree to the repeal the tax on devices, which he said cost the industry $2 billion in taxes this year. The tax is expected to raise nearly $30 billion for the federal government over the coming decade and affects products ranging from stents and hip replacement parts to surgical gloves.

A bipartisan group of House lawmakers last week proposed repealing the tax as part of a compromise to end the shutdown, but its prospects remain unclear. "We are focused on getting this accomplished before Congress finishes it business for the year," Scott said.

The advocates for chicken farmers may face a more difficult route.

The farmers and processors have sparred for years over the proposed rules, which require chicken companies to give farmers 90 days' notice before pulling their business.

Congress first authorized new rules governing chicken processors in a 2008 farm bill, but under industry lobbying, lawmakers added language ordering the administration to roll back the regulations as part of a stopgap spending bill signed into law March 26 to keep the government operating.

That temporary spending bill expired Sept. 30. New versions of stopgap spending proposals passed by Senate Democrats and House Republicans ahead of the current budget impasse have maintained the rollback.

At issue: The often-contentious relationship between commercial poultry farmers and the processors who contract with farmers to raise chickens. Farmers complain companies can demand costly upgrades of their growing facilities, and cancel contracts without warning, endangering their livelihood.

Poultry growers have become "serfs on their own land, serfs with really big mortgages," said Steve Etka, a lobbyist for the Campaign for Contract Agriculture Reform. "We are only asking for some basic fair business practices to be enforced."

Democratic Sen. Jon Tester, a Montana cattle farmer, also wants to nullify the language. "Without these rules being written and enforced, you allow these folks to have control of the industry and set prices," Tester said of meatpackers and poultry processors.

Poultry industry officials say the administration's regulations exceeded what Congress authorized five years ago in the farm bill and keeping the language in any new stopgap spending measures is important to force the Agriculture Department to begin rolling back the rules, which are currently in limbo

Despite the directives in the March spending bill, "we have yet to see the â?¦ provisions specific to chicken producers rescinded" by the administration, Tom Super, a spokesman for the National Chicken Council, said in a statement. "Until we do, we'll continue to press for their inclusion to get this rule back to Congress' original intent."

Poultry producers have said they need the ability to suspend orders on chickens to deal with falling demand. When the administration finalized the rules, the chicken council estimated that the changes would cost the industry as much as $55.5 million each year.